Toys R Us becomes the latest and most prominent retailer in terms of online sales to file for bankruptcy this year.

Toy retail chain Toys R Us Inc. is the latest and largest retailer in terms of online sales to file for Chapter 11 bankruptcy protection.

Toys R Us, No. 38 in the Internet Retailer 2017 Top 500, on Tuesday filed for bankruptcy in U.S. Bankruptcy Court for the Eastern District of Virginia after weeks of speculation that it would seek to reorganize. Late last week, reports emerged that vendors were scaling back shipments to Toys R Us amid concerns of bankruptcy filing.

Toys R Us will continue to operate its online store as well as its approximately 1,600 physical store locations throughout North America.

“Chapter 11 was certainly not the company’s preferred outcome,” CEO David Brandon wrote in a court filing. “The timing of all of this could not have been worse.” Toys R Us is focused on building inventory for the holiday season, which accounts for 40% of annual revenue, and anew $3.1 billion operating loan will allow the retailer to stabilize operations and reopen supply channels while in bankruptcy, he said.

“Together with our investors, our objective is to work with our debt holders and other creditors to restructure the $5 billion of long-term debt on our balance sheet, which will provide us with greater financial flexibility to invest in our business, continue to improve the customer experience in our physical stores and online, and strengthen our competitive position in an increasingly challenging and rapidly changing retail marketplace worldwide,” Brandon wrote.

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Much of the $5 billion in debt stems from a $7.5 billion leveraged buyout in 2005, when Bain Capital, KKR & Co. and Vornado Realty Trust loaded the company with debt to take it private. Since then, the chain has struggled to dig itself out and faced fierce competition from e-commerce giant Amazon.com Inc. (No. 1 in the Top 500) and retail chains including Wal-Mart Stores Inc. (No. 3) and Target Corp. (No. 20).

In its Chapter 11 filing, Toys R Us cited assets of $1 billion to $10 billion and liabilities in the same range. Its two largest creditors include the Bank of New York, to which it owes $208.3 million, and toy manufacturer Mattel, to which it owes $135.6 million.

Toys R Us generated an Internet Retailer-estimated $1.488 billion in online sales in 2016, up 10% from $1.353 billion the previous year, according to Internet Retailer’s Top500Guide.com,

Toys R Us is the largest retailer in terms of online sales to file for bankruptcy protection in 2017, but it is far from alone when it comes to major retail chains facing dire financial straits.

The run of retail chains filing for bankruptcy in 2017 started in January with apparel retailer Limited Stores LLC (No. 216 in the 2016 Top 500) and has since grown to include the likes of Payless ShoeSource (No. 364 in the 2017 Top 500), Gymboree Corp. (No. 392), and rue21 Inc. (No. 408).

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